The first listed traded product (ETP) has arrived on the market that allows investing in the main cryptocurrency, bitcoin (BTC), and the ancient store of value, gold. This new fund will be listed on the SIX Swiss Stock Exchange from today, under the name 21Shares ByteTree BOLD ETP (BOLD).
The responsible estimated what BOLD encompasses the best of both assets: the possibility of a high revaluation of the price of bitcoin and the greater stability of the value of gold. Your quote will track an index benchmark which tracks the price of multiple assets, as well as will rebalance monthly based on the historical volatility of the last 360 days
We are excited to introduce the world’s first bitcoin and gold ETP to the public. The fund’s creators are Swiss provider of listed cryptocurrency products 21Shares and UK alternative investment company ByteTree Asset Management.
In order to offset risk, the less volatile asset (gold) occupies the majority of the instrument. Its weighting for the launch will be 81.5%, while that of bitcoin will be 18.5%, figures that will be rebalanced month by month.
In this way, it combines the traditional value of the precious metal with the promising rates of return of the cryptocurrency, which is considered by many to be the new gold, said Hany Rashwan, the CEO and co-founder of 21Shares.
The fund seeks to be a shield against inflation
Charlie Erith, CEO of ByteTree Asset Management, said: “Gold has historically provided portfolio protection in inflationary environments, while bitcoin is the digital equivalent of gold with growing investor adoption as a distinct asset class and a central reservoir of wealth.
In this way, he estimated that the fund seeks to be a investment strategy against rising global inflation. A problem that crosses countries as different as the United States with an interannual rate of 8.5%, Spain with 9.8% and Argentina with 55.1%, according to MacroData.
“At a time of rising core inflation and heightened geopolitical risk, we believe this can act as an important risk-return diversified instrument in a balanced portfolio,” stated the CEO.
Along these lines, the specialist in investment funds listed on the stock exchange, James Seyffard commented: “gold and bitcoin are more aptly described as complementary assets in a portfolio, rather than the common narrative that one is a substitute for the other.”
Therefore, he believes that investors should take advantage of both to maintain a diversified portfolio. So also for counteract its negative effects, which can be the sharp drop in the price of the cryptocurrency and the little rise that gold has.
Although it is worth clarifying that, despite the fact that gold is commonly known as a valuable asset, it has not always been so. As reported by CriptoNoticias, its price has varied from USD 2,450 to USD 423 in the last 32 years. However, its fluctuations are minimal on a day-to-day basis, which makes it stable in the short term, unlike bitcoin, which tends to make strong drops and rises in a short time.
Right now, an ounce of gold is trading at $1,903 (EUR 1,800), while bitcoin is trading at $38,952 (EUR 36,795), according to GoldPrice and the CriptoNoticias calculator.